Petronas to double capex to RM60b on project ' catch-up'

" MALAYSIA' S national oil company Petroliam Nasional (Petronas) plans to double its capital expenditure to RM60 billion (S$18.8 billion) this year from 2021, as business activities normalise following the lifting of Covid-era restrictions.

Many of its projects were delayed due to the pandemic and " there' s a lot of catch-up that' s happening this year," Group chief financial officer Liza Mustapha said in a conversation with MIDF Group' s managing director Charon Wardini Mokhzani on Thursday (Jun 9).

Petronas expects to post a " triple-digit" growth in revenue this year amid high oil prices, Liza said. Its first-quarter profit more than doubled to RM23.4 billion from a year earlier on the back of a 50 per cent jump in revenue.

Still, elevated oil prices may not be " very sustainable," Liza said. " It can go up as quickly as it can come down."

Brent crude surged past US$124 a barrel on Thursday, taking this year' s gain to almost 60 per cent, as economies rebounded from the pandemic and Russia' s invasion of Ukraine upended trade flows and led to further tightening.

Petronas is basing its projects at prices of US$50-US$60 per barrel, she said. The firm is also looking to get " quite a sizable chunk" of its revenue from non-oil and gas over the next 5 to 6 years."

The shareholders of Pegasus Advance Engineering Sdn Bhd (PAE M) -    Mohamed Ridza Bin Mohamed Abdulla (&ldquo MRA&rdquo ) (51%) and Mun Siong Engineering Sdn Bhd (&ldquo MSE M&rdquo ) (49%). 

PAE M has issued 8.0 million new ordinary shares at RM1.00 each which have been subscribed by MRA and MSE M on a pro-rated basis. Proceeds from this new ordinary share issuance is RM8.0 million and will be utilised to redeem all the outstanding RCPS of RM8.0 million. Subsequent to the completion of the issuance of new ordinary shares, the shareholders&rsquo fund will be RM8.75 million comprising of 8.75 million ordinary shares. RCPS will be issued, in the event, that PAE M needs to meet its working capital commitments. 

PAE M is currently erecting a new fabrication yard on a property purchased in 2021 to cater for it' s existing Client and will be completed by the end of 2023. This is inline with Petronas planned capex.

Being one of Petronas contractors, Mun Siong bound to benefit from Petronas capex on the long overdued Project " Catch-up" .

DYODD